SteelMint’s weekly Odisha iron ore fines (Fe 62%) index has fallen by around INR 200/t to INR 8,500/t (ex-mines, including royalty, DMF and NMET). Market participants expect further correction in prices in the near-term due to limited buying at current offers and decline in pellet prices. A few bulk buyers expect a price correction of INR 500-1,000/t in Odisha iron ore fines offers in the coming days.
Steel Authority of India Ltd (SAIL) had conducted an auction on 9 Aug’21 for 136,000 t of iron ore fines (Fe 62.5%) from its Bolani iron ore mines in Odisha. Out of the total quantity, SAIL received bids for 56,000 t at around INR 8,800/t (loaded, including royalty and statutory levies), market sources reported to SteelMint.
In a deal recorded by SteelMint, a merchant miner sold 50,000 t of Fe 62% fines at around INR 8,350-8,450/t ex-mines. Another deal was recorded by SteelMint in which a miner sold three rakes of Fe 62% fines at INR 8,300-8,400/t ex-mines.
Recent trade and rationale:
- A total of three deals were heard this week for fines and, all considered under T1 trade, accorded 50% weightage in the index calculation for Fe 62% fines.
- SteelMint received nine (09) offers, indicative prices under T2 trade in this publishing window and eight (08) were taken into consideration and given 50% weightage. To check out SteelMint’s iron ore assessments, pricing methodology and specification documents Click here
SteelMint’s iron ore lump (5-18mm, Fe 63%) index stands at INR 12,500-12,700/t (ex-mines, inclusive of royalty, DMF and NMET). However, no deals were recorded for lump ore this week. Availability crunch still persists for lumps, SteelMint notes.
Highlights from Odisha:
- In a significant development, JSW Steel has apprised the Odisha government’s Directorate of Mines that it wants to surrender the Gonua iron ore mine in Odisha. The steelmaker intends to surrender the entire lease area of the 2.99 mn t/year mine in Odisha’s Sundergarh district.
- JSW Steel has been slapped with a demand notice totalling INR 717 crore for production shortfall at Jajang iron ore mine, which the steelmaker is considering to surrender shortly, as per sources.
- A year after it auctioned 19 new mining leases, the Odisha government is preparing to penalise half the auctioned mines for falling short of their MDPA despatch targets.
- Stamp duty and land issues were raised at the pre-bid conference of the Odisha government ahead of the latest round of mines auctions. About 65 companies participated in the pre-bid conference on 6 Aug and submitted questions in writing that ran into hundreds, as per SteelMint reports.
Odisha iron ore prices:
Chhattisgarh invites bids for four iron ore blocks:
- The Chhattisgarh government has identified four iron ore blocks to put up for auction, including the North Bailadila A and Bailadila B blocks in the left wing-extremism affected Dantewada region.
- The blocks are now free after the Centre’s amendment of the MMDR Act negating claims under Section 10(a) 2 (B). The tender notice put out by the Mineral Resources department of the Chhattisgarh govt does not specify the reserves of the four blocks.
NMDC lowers base prices for Karnataka e-auction – India’s largest merchant miner NMDC has decreased iron ore base prices for the auction from its Donimalai mines, SteelMint learnt from sources. Prices have fallen by around INR 200/t for iron ore fines and by around INR 500/t for lumps. The floor price for fines (Fe 65%) stands at INR 5,719/t, while that for iron ore lump (Fe 65%) is at INR 6,851/t (basic, excluding taxes).
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